Telephone & Data, Entergy New Orleans issue $25-par bonds; NextEra's recent deal lists

By Stephanie N. Rotondo

Phoenix, Nov. 26 - The preferred stock market was "still asleep," a trader said Monday, adding that the space was dealing with a "Thanksgiving hangover."

Despite said hangover, two new deals hit the tape early in the day and were performing well in the gray market.

Telephone & Data Systems Inc. announced an offering of at least $100 million of $25-par senior notes due Dec. 1, 2061.

The deal priced at the tight end of talk - 5.875% to 6% - and came upsized at $175 million.

A trader noted that there was no selling group.

Meanwhile, Entergy New Orleans Inc. said it was planning to sell at least $30 million of $25-par first mortgage bonds due Dec. 1, 2052. The company did just that, pricing the paper at 5%.

Price talk was around 5.125%.

"They're small, well-known names," the trader explained as the reason for the deals' positive performance. Entergy specifically "always trades at a premium."

Overall, the preferred arena "seems to be mixed," a trader said early in the day, even as the straight equity market was declining on "fiscal cliff" concerns. He said some issues were down as much as 30 to 40 cents, but he did not think that was all that significant, especially as it did not appear to be in any one particular sector.

By the close, a market source said the session was "not so bad for a Monday," though he did note that the market closed down about 4 cents on average.

Telephone & Data prices

Telephone & Data Systems priced $175 million of 5.875% notes due 2061 on Monday.

Paper was offered at $24.75 in the gray market as of midday.

After pricing, a trader quoted the issue at $24.65 bid, $24.75 offered.

At the close, a market source pegged the deal at $24.80.

Proceeds will be used for general corporate purposes, which may include acquisitions.

The diversified telecommunications services company is based in Chicago.

Entergy sells mortgage bonds

Entergy New Orleans brought $30 million of 5% first mortgage bonds due 2052.

That issue was trading around par in the gray market at midafternoon.

Once the deal priced, a trader quoted the issue at $24.95 bid, par offered.

Proceeds from the sale will be used to repay borrowings from the Entergy system and for general corporate purposes.

Entergy New Orleans is a power producer.

NextEra lists

NextEra Energy Capital Holdings Inc.'s recent 5.125% series I junior subordinated debentures due Nov. 15, 2072 began trading on the New York Stock Exchange on Monday.

The ticker symbol is "NEEPI." The deal came Nov. 14.

The securities opened at $24.70 but closed at $24.60.

In other recent deals, First Republic Bank's $150 million of 5.625% series C noncumulative perpetual preferreds - a deal that came Nov. 15 - is expected to hit the NYSE on Tuesday.

The expected ticker is "FRCPC." A trader said the preferreds were quoted at $24.75 bid, $24.90 offered.

RBS gets busy

Royal Bank of Scotland Group plc's preferreds were dominating trading in the secondary market, though without any news to act as a catalyst.

A market source said it was "just a couple of people rearranging their positions." He also noted that the Edinburgh, Scotland-based bank's common stock closed down in both London and New York.

The 6.08% noncumulative guaranteed trust preferreds (NYSE: RBSPG) ended up 14 cents at $19.49, while the 7.25% series T noncumulative dollar preference shares (NYSE: RBSPT) put on just a penny to end at $23.60.

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